Exam 7: Individual and Group Decision Making: How Managers Make Things Happen

A decision tree, which is the hierarchy or chain of command used by many organizations when discussing alternatives, must be followed when getting decisions approved.

When confronted with a choice, people with strong prior beliefs tend to make their decisions based on their beliefs even if their beliefs are false. This is known as ____.

With groups, a consensus is not usually required with decisions.

Utilizing a group to make a decision has the advantages of having a greater pool of knowledge, gaining different perspectives, providing intellectual stimulation, having a better understanding of decision rationale, and having a deeper commitment to the decision.

Summarize some of the hindrances to perfectly rational decision making.

When Donald, a management trainee, asked Rebecca, the HR manager, how she makes the decision on who to hire, Rebecca responded with several simple steps that she called "rules of thumb." Rebecca's decision-making process, or rules of thumb, is a strategy known as heuristics.

When Dave, the sales manager, is deciding on who will train the new sales trainee, he tries not to look at just the recent sales numbers but also checks past sales reports to determine who is the most productive. This way he is not affected by the ______ bias.

During the Apollo 13 emergency, at various times during that crisis the flight commander brought Mission Control workers and experts together to generate multiple ideas and alternatives for solving the problems. This was an example of brainstorming.

Tom is in the marketing department with Home Made Soups. He was given the responsibility of determining if customers like the new spicy chicken noodle soup. It is believed that over 4,000 customers purchased the new soup last month. If Tom surveys 25 of those customers, this is an appropriate sample size for decision making.

Susanne, the CEO of national IT manufacturer, was approached by Simple Phones, a new company that is marketing a new type of phone, to partner with the company on a project. The partnership is uncertain since the company and technology are new. Susanne is uncertain what to do because she is limited by numerous constraints, such as the uncertainty and complexity of the technology, the management success of Simple Phones, and time, since other companies are interested in the partnership. This is an example of _____.

Harvard Business School Professor Constance Bagley suggests that organizations should never use a decision tree to help with ethical decisions.

Doug, a new manager, commented to a friend, "I am excited about different aspects of my new job. The company computers have entered the field of decision making. The network not only collects information more quickly, but the system also reduces the roadblocks when I need a group consensus." Doug is referring to _____.

One management expert advises that to achieve a consensus, groups should use active listening skills, involving as many members as possible.

When it comes to decision making, it is accurate to say that groups _____.

A benefit of the intuition model for making decisions is that it can slow decisions, which is useful when decisions involve many details.

In business, the use of time-series forecasts, which predict future data based on patterns of historical data, is an application of evidence-based management.

Leon is an investment portfolio manager. While sitting in a training workshop, the facilitator mentioned that "your female investors make trades much less often than men because they ____."

Patty, the CEO of an oil drilling company, and her top management team recently discovered that their facilities are damaging an Asian beach and the local wildlife. They understand that they need to decide if temporarily closing or not closing the facility is unethical. They then consider the four questions: Is not temporarily closing the facility legal? If yes, does this proposed action maximize shareholder value? If yes, is not temporarily closing the facility ethical? If no, would it be ethical not to take the proposed action? These are suggested questions according to _____.

When faced with a decision, Myles asks himself "Why not just take the easiest way out?" This approach is known as relaxed change, and is a form of evidence-based decision making.

Is the proposed action legal? If yes, does the proposed action maximize shareholder value? If yes, is the proposed action ethical? If no, would it be ethical not to take the proposed action? These are four questions that managers of all organizations should ask when confronted with a decision on an action according to _____.